Sponsors promise wine bill isn't dead

The fight over the state's alcohol laws appears to be broadening.

A bill that is popular with consumers that would have allowed the sale of wine in grocery stores was shelved Wednesday. The measure's supporters instead called for an expansive study into all of the state's liquor laws in what could be the first comprehensive look at how alcohol is sold in the state since Prohibition.

Rep. David Shepard, a key sponsor of the wine-in-supermarkets bill, abruptly backed off the measure Wednesday, saying the bill did not have enough support to pass this year.

But the move appears to amount to little more than a short-term truce in the debate, as sponsors said they would launch a yearlong study of the state's alcohol laws after the legislative session wraps up this summer.

The study is meant to pave the way for a compromise and a fresh start to alcohol regulation in the state.

"We're hoping we'll be able to get them to the table and get them to talk about the issues in-depth," Shepard said. "We need to take it a little bit out of politics."

At issue is Tennessee's so-called three-tier distribution system, which requires alcohol to pass through state-licensed wholesalers before being placed on store shelves.

Critics of that system say it locks out competition by giving monopolies to beer and liquor wholesalers and by restricting price competition among retailers. Proponents say it keeps alcohol sales under tight control, curbing abuse and underage drinking.

Now both supporters and opponents of the state's alcohol distribution system say the laws are too complicated and interconnected to unravel them one by one, like what was being attempted with the bill that would allow wine to be sold in grocery stores.

Shepard said he withdrew his bill after meeting Tuesday with Sen. Bill Ketron, the bill's Senate sponsor and the chairman of the Senate State & Local Government Committee, as well as the Tennessee Grocers & Convenience Store Association, its biggest supporter.

Rather than push the legislation this year, Shepard and Ketron said they would support the creation of a study committee that will meet periodically for more than a year to review the state's alcohol control rules and deliver a report to the legislature in July 2010. That would put a broad alcohol measure on track for introduction when the next General Assembly convenes in 2011, Ketron said.

"Our laws are pretty archaic, and some go back to 1933," he said. "If we're going to do it, let's do it right and get it into the 21st century."

Lobbying is intense
The move follows an intense lobbying war that has pit supermarkets against the state's alcohol industry.

Wholesalers and retailers have long held significant sway in the state legislature, in large part because of their substantial gifts to lawmakers. In 2008 alone, alcohol distributors gave more than $200,000 to candidates and political action committees, while retailers contributed an additional $26,750.

Supermarket companies are hampered by the state's campaign finance laws from giving to candidates, and they have instead mounted an aggressive letter-writing campaign.

The effort, known as Red White & Food, has used bumper stickers, store displays and other means to get consumers to write state legislators in support of changing the wine law.

The effort seems to be paying off.

A telephone survey of 629 Tennessee adults released by Middle Tennessee State University in March found that 62 percent said they favored the sale of wine in grocery stores, while 26 percent opposed the idea. 12 percent said they were undecided.

"This is the second most e-mailed issue, for me, behind the income tax," said Rep. Glen Casada, R-College Grove, a vocal backer of the wine-sales bill.

Representatives for the supermarket industry said they were disappointed that their measure was withdrawn for the year, but they nonetheless depicted the debate as a victory.

About 10,000 people signed up for the Red White & Food campaign, and the prominence of the issue this legislative session shows the power of that organization, said Jarron Springer, the grocers association's president.

"A couple of years ago, we would have been surprised if you could get the State & Local Government Committee to have a hearing," Springer said. "That's a step forward."

Many consumers, however, took the action as a setback.

"I just can't understand what the big deal is or why anybody would oppose it," said Tom Sebille, a retired automotive engineer who lives in Nolensville.

Liquor stores cheer
Liquor store owners, meanwhile, cheered the decision. They said loosening the state's wine-sales laws would result in more alcohol in the hands of minors. They also said that because wine has higher alcohol content than beer, it should be sold in dedicated liquor stores.

"People just don't understand what was in the bill," said Bard Quillman, owner of the Red Dog liquor store in Franklin and a director of the Tennessee Wine & Spirits Retailers Association. "Every single person that I've talked to, when I get done talking with them, they go, 'I don't want it.' "

The issue also is complicated by the state's byzantine alcohol control laws, codified over several decades, they said.

For instance, those laws say liquor stores must be owned only by Tennessee residents and nobody can own more than one store. Such rules would put liquor retailers at a competitive disadvantage to major grocery store chains, they said.

"This is not an easy, one-line fix," Quillman said. "You don't change the law with a one-page bill."

In the General Assembly, lawmakers frequently will ask to study a bill further to kill legislation, but supporters of the wine-in-supermarkets bill said they do not intend to let the measure die.

The grocers association said they will continue to encourage consumers to write lawmakers in support of the bill and liquor store owners they welcome the chance to show legislators the merits of the current system.

"This issue will be back," Shepard said. "It will be studied. There are a lot of issues with this bill that we were going to have to fight for, but things do change."